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Canada stunned as oil-rich Alberta votes in leftist government

Canada's federal Conservatives are tallying the damage a day after Alberta ended the 44-year rule of its sister party, in what is the nation's most conservative province. The left-leaning New Democrats surged to power.

More than four decades of Conservative rule in Canada's western oil-rich province of Alberta ended on Tuesday, after voters elected a left-of-center provincial government.

New Premier-elect Rachel Notley has promised to raise corporate taxes, and review Alberta's oil and gas sectors. She wants to shake up the province's royalty structure, to ensure inhabitants are getting a fair return on oil and gas resources. Alberta has the world's third largest oil reserves, and is the largest source of US oil imports.

Notley (pictured above) has said her party will be a "good partner" to the powerful energy industry, which fears higher costs and opposition to pipelines.

"I am hopeful over the course of the next two weeks they (energy executives) will come to realize that things are going to be A-OK over here in Alberta," she said.

"Disbelief and dismay"

The result has sent shockwaves across Canada, with few predicting such a result a month ago when Jim Prentice, the now-outgoing Conservative premier, called the election. Alberta is considered the heartland of Canada's right-wing movement and is home to Prime Minister Stephen Harper.

Prentice, once considered a candidate to replace Harper, has now quit politics.

"Even now our inboxes are filling with messages expressing something between disbelief and dismay," analyst Andrew Bradford of Raymond James brokerage told Reuters.

Some have said the royalty structure review will mean companies will steer investment to other provinces.

"If you're a producer and you've got operations in [British Columbia] and operations in Alberta, for the next six months to a year, without knowing what royalty rates are going to be for a while, you're just going to ship that capital to B.C.," said AltaCorp Capital analyst Jeremy McCrea.

Boost for Conservatives?

A meeting of Canada's federal party on Wednesday was described as being like a "morgue," according to Justice Minister Peter McKay. But campaign watchers say the dynamic in Alberta is different than it is nationally, and won't translate into poor results for the federal Conservatives - which are seeking a rare fourth consecutive election win in October.

One big difference is the fact that the federal Conservatives are unchallenged by any party on the right, whereas the right-wing vote in Alberta was split between two parties - the Conservatives and the Wildrose Party. The two parties together took 52 percent of the vote on Tuesday, compared to the New Democrats with 41 percent.

"I don't think Harper is affected by this...people vote federally and provincially very differently," said Ipsos Reid pollster John Wright.

Another said the result could actually help the federal Conservatives.

"The Conservatives should be happy with NDP gains because, if they come, they will be overwhelmingly at the expense of the (opposition federal) Liberals," said Professor Nelson Wiseman, a University of Toronto political scientist.